Fair Money

By Dick Eastman

Don’t let anyone fool you. Our money today is backed. It is backed by collateral security and that collateral multiplies with deposits under the present debt-money and fractional-reserve system as money is multiplied with the money multiplier. The more we borrow the more we stand to loose when deflation forces default.

The more the banking system multipliers loaned money with the reserves created by new money put in a bank — the more banks gain leans on our assets, securities, equity or whatever else in addition to our own personal surety the lender will accept.

New money put in a bank — instead of transfer of deposits from one checking account to another.

The loan is the bargain with the devil.

The interest rate is the measure of the speed at which ruin comes galloping.

What I will now call the aggregate debt is the total amount the entire nation owes which, since our money almost exclusively loan deposits that we transfer, the paper money bills and minted coin in existence not being enough to meet interest obligations.

So then aggregate debt is both the mountain of principal and interest which cannot be paid and also the mountain of assets that are going inevitably to be transferred from the people to the international lending class.

I submit to you that all economics is fraudulent that talks in terms of the economy being in a stabil equilibrium. That economists are never being bigger liars that when they talk about sustainable growth, sustainable, development, sustainable (non-”mal”) investment etc. The truth is that the economy of the people, of the three sectors of the “real economy” household, government and production are always decaying at a rate determined by total debt and the higher or lower structure of interest rates for all kinds of loans, risks, expectations.

The economy is never in equilibrium. The people are never in a stable situation — they are either being eaten up by a boom — or they are temporarily being activated by easy money and easy lending of the boom phase of the business cycle. The boom phase of the business cycle is when the the money lenders of the central banking and lending seed economic expansion because there is something they want developed — lands or technologies or militaries — allowing new influx of loans to get ahead of “interest drain” — and during these booms the creativity of the people (otherwise kept on starvation money rations) takes off and great things are done — and when the technology is developed and the land improved and all of the research and development has been done by the common man’s engineering, science, management, innovation, skills etc. then the Upper-Loop lending elites turn off the credit machine — they call in loans, they position themselves for a downturn, so that with the new money no longer flowing — and with interest rates having climbed high as they do in a boom — the boom turns to bust, and the common man’s boon to dust. All the money is bank loans — and what must be paid back is the amount of the loans plus continusously compounding interest — and nowhere near the paper money needed (above and beyond principal) to pay the interest (which is there was enough there would be no money left over for buying food, hiring people, paying rent or taxes or utilities. Doom is foreordained. Under the debt-money system.

You of course are told the opposite. You are told — in the midst of this devestating deflationary spiral, this super depression of the households, local and national production and government by debt burden and interest obligations that can’t be met by debt-based money — you are told that there is inflation — that government printing presses are putting out unbacked money — which is a falsehood — or rather several falsehoods — because this falsehood of inflation, hides the truth about deflation causing default, the truth that there is a constant drain of the wealth of the people from ever shrinking money to keep us employed at meeting each others needs. Not only less money to buy, but less money that forces you to sell and to default on interest payments so that you loose the home equity, the business equity and other assets attached to the loan contract. The interest and ownership of foreclosed collateral all draining away to the international financial sector which for all intents and purposes is a foreign hostile power seeking to plunder your country.

The problem is this country using as money checkbook deposits that only exists as a secured loan, as temporary money tied to the obligation to repay principal and interest — when we should be using money that is supplied free as a public utility — as infrastructure supplied to make market transactions possible and mutually beneficial. Our money today is checking deposits that use to buy things and pay taxes, but all of those deposits are on loan and must be returned to banks at interest — and if you can’t pay the interest (and it impossible for all of us to pay it) you lose your home, your business or other asset wealth.

The problem is the net interest drain that results from using for our money supply the most unnecessary bondage of loan indeptedness — useing collateral-secured loans to create our checking account deposits. It is money that must be returned, that must be returned principal plus constantly compounding interest. It is money that if it is not returned will end with the borrower losing his house, his credit rating and whatever other security he has pledged to the lender.

We are so used to it that we can no longer see that an alternative — a much happier alternative — is immediately available if we will simply throw off our blinders and throw out the Money Mafia and take it.

Aha, but there is enough money available for all we want to do in this grand and beautiful world and it is in the very air we breathe if we are daring enough to insist upon having it.

Making money supply independent of mortgage and houseing industry loans. The money supply is permanent and houses are bought only from peoples savings through a 100% lending of savings system. That way the money stays even as houses are paid off. The banks cannot make money by manipulating the national money supply to create deflation profitable to creditors and harmful to borrowers. Banks will no longer have power to influence the economy at the marco-economic level — which has been the worst kind of monopoly power possible — the private monopoly of credit that control the total flow of purchasing power in our lives. Instead we get full consumer sovereignty with all new money comeing from households through the thin-air national dividend.

Now then, beware of these False Remedies:

What is shown above is possible with social credit. But as things are now — the super rich make more money by deflating the economy than buy building it with investing in domestic productivity. With deflation their IOUs become more valuable — as foreclosed assets come are sold to the money hoarders after the collapse of the household or enterprise.

Bailouts only go to the upper loop wealthy who, as mentioned above, have more to gain by not investing the money received until it is time buy up assets after the economy has crashed.

While it is true that taxation cannot be used to pay off the national debt and at the same time pump money through government spending to keep the economy going. Taxation to pay the impossible interest burden is criminal — the
government is nothing but an accomplice with both raising taxes and cutting spending.

Then we have the false solutions of the phony populists who want to use government treasury money — for what? — TO BAIL THE CREDITORS after the debtors are squeezed so much that they can no longer keep up payments. Steve Keen’s plan gives no direct money to consumers, to households. It does not pay their debts for them — but only takes up making payments when the family is crushed by the burden and has paid all it can — at that point Keen uses the printing press to PAY THE CREDITORS!!!! With Keen are Michael Hudson and Ellen Brown. — who advocate this but also would have Congress pick government projects to spend money into the economy. Thus under their system Congress will no longer have to make a budget but will simply decide where to drop money — on what voters!!! — deciding who gets to be the first spender of a heap of new money — and the first spender always gets to spend before the new money they are spending pushes up prices. (WIth social credit the unfair advantage of “first spender” awared political by Congress — as completely gotten rid of by having all new money originate with the houshold, and in equal amounts to each person — so that we can all share equally in the priviledge of being first spender of new money. I am still waiting for any of these would-be reformers to deny that that is exactly what they are calling for.

Dick Eastman is a strong advovcate of debt currency and a regular contributor to the Rebel Blog. You can find more of his writings on https://therebel.org/eastman.

Source: The Rebel